Marine Products Corp. reports 1Q results - Trade Only Today

Marine Products Corp. reports 1Q results

Chaparral and Robalo parent company Marine Products Corp. said today that it posted a 25.7 percent increase in net sales for the first quarter.
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Chaparral and Robalo parent company Marine Products Corp. said today that it posted a 25.7 percent increase in net sales for the first quarter, due in part to a 36.7 percent leap in unit sales that the company is attributing to popularity among its smaller models.

The company reported nearly $63.7 million in sales for the quarter that ended March 31, compared with slightly more than $50.6 million in the quarter last year, an increase it attributed to the rise in unit sales, partially offset by a 9.3 percent decrease in the average selling price per boat.

The company reported a profit for the quarter of $3.92 million, or 10 cents a diluted share, an increase of $992,000 or 33.9 percent, from $2.93 million, or 8 cents a share, in the quarter a year earlier.

Several product lines contributed to the sales gain, but the company said sales of Robalo sportfishing boats, Chaparral H2O models and Chaparral SunCoast Sportdecks were particularly strong.

Average selling prices decreased during the quarter because of a model mix that included a higher percentage of smaller boats.

"The first quarter of 2016 continued the favorable trends of the past few years, and in fact this quarter's sales were the highest quarterly sales in eight years,” Marine Products president and CEO Richard Hubbell said in a statement. “We recorded improved sales of our Robalo outboard sportfishing boats, especially the Robalo 160, which we introduced early in this model year.”

Chaparral SunCoast outboards also sold well and Hubbell said the company saw increased demand for Chaparral H2O sterndrives.

“At the end of the first quarter of 2016 our dealer inventory was higher than at the same time last year, but appropriate to the level of dealer demand we see as we enter the strongest part of the retail selling season,” he said. “We are very pleased with our dealers' and retail customers' reception to the new models we have recently introduced, as well as the general sales strength among our sterndrive models.”

The board of directors also announced today a regular quarterly cash dividend of 6 cents a share, adding that the company is “prepared to consider strategic acquisition targets.”

Gross profit for the quarter was nearly $12.7 million, or 19.9 percent of net sales, a 24.3 percent increase from $10.2 million, or 20.2 percent of net sales, in the same period last year.

Gross profit increased, compared with the prior year, because of higher net sales. Gross margin declined slightly from the prior year’s quarter because of the model mix, partially offset by improved manufacturing efficiencies resulting from higher production volumes.

Operating profit for the quarter was slightly more than $5.6 million, an increase of 32.7 percent from almost $4.3 million in the first quarter of last year.

Hubbell acknowledged the death of Chaparral president and Marine Products director Jim Lane in the first earnings report since his passing.

“Jim had served as the president of Chaparral for almost 40 years, and his passing is a loss to our company and to our industry,” Hubbell said. “Our company and Jim's family appreciate the support of the recreational boating community over the past few weeks. The tenured operational management that remains in place at our company will continue our tradition of strong brand management, customer satisfaction and profitable financial performance for many years in the future."

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